London law firms pay female partners 24 per cent less than their male counterparts, a new survey has revealed. Male partners reported earning an annual average of £667,521, compared to female partners’ average of £502,841. The difference in originations between women and men was 10 per cent – with female partners responsible for average originations of £1,810,976, compared to £2,017,857 for male partners. The survey, by search firm Major, Lindsey & Africa, also revealed that over half of the partners surveyed feel that bias plays a role when it comes to determining compensation. Cronyism is the most commonly identified bias at 38 per cent, followed by bias against home grown partners at 21 per cent. Female partners are more likely to identify bias at their firm, and much more likely to identify gender bias than male partners (37 per cent versus eight per cent).
Challenges
'This data highlights that we still have a long way to go before we reach compensation parity for women in law firms,' said Nick Paleocrassas of Major, Lindsey & Africa’s partner practice group. 'While the survey brings to light many positives, particularly that City partners overall feel relatively satisfied and fulfilled, it also accentuates some of the challenges that come with practising law at the highest level.'
Satisfaction levels
The survey also revealed that satisfaction among laterals was notably higher than among home-grown partners: Three in four lateral partners described themselves as satisfied (without factoring in compensation considerations) versus 57 per cent of home grown partners. Additional matters relating to partner compensation were also examined, such as willingness to trade compensation for other benefits, perceived bias impacting compensation and transparency of remuneration structure and compensation system. The survey also revealed that city partners report higher levels of overall satisfaction when factoring compensation into their considerations. Three in four (76 per cent) of respondents classified themselves as very satisfied, moderately satisfied or slightly satisfied when factoring in compensation, versus 69 per cent when compensation was not taken into consideration. Only 19 per cent of partners said that they were dissatisfied with when factoring in compensation and only 25 per cent expressed dissatisfaction when not taking it into account.
Other benefits
More than half (55 per cent) of the participants would trade in a portion of their compensation for another benefit. The most desired benefit is more time off, followed by a more flexible work schedule and reduced billable hours. Home-grown partners are most likely to consider trading in a portion of their compensation in return for another benefit. Nearly half, 47 per cent of men reported that they would not trade compensation for other benefits compared with 39 per cent of women.
Gender pay gap
Only one third of partners know whether their firm has calculated its gender pay gap. UK firms and Verein firms are more likely to have done so. Visibility appears limited even among firms that have calculated the gender pay gap, with few partners able to confidently state the value of the gap.There is clear correlation between openness of the compensation structure and partners’ satisfaction with their compensation. Overall partners working in open compensation systems identified themselves as more satisfied than those working in less transparent compensation systems.
Meritocratic systems
Most law firms have now moved away from lockstep towards more meritocratic systems with 43 per cent reporting that this has had a positive impact on earnings and 28 per cent believe it has had a positive impact on retention. However, the data suggests that partners believe it has a negative effect on collaboration, information sharing and allocation of work.
Methodology
The survey by Major, Lindsey & Africa, the world’s largest legal search firm, was conducted in conjunction with Acritas and measured respondents’ satisfaction with their professional lives and their work as lawyers. It fielded responses from partners representing 67 firms in the Magic Circle, the top 30 UK firms and the AmLaw 100 firms with London offices.
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